JUNEAU, Alaska (AP) – The Alaska Senate has approved a spending proposal that would cut education funding, reject pay raises for public employees and otherwise make deeper agency cuts than the House.
The vote Friday evening was 16-4 and followed hours of debate. Notice of reconsideration was given, meaning the bill can be voted on again before heading back to the House.
If the House does not agree with the Senate version an expected outcome the budget will go to a conference committee, where House and Senate negotiators will work to hash out differences.
The version of the operating budget that passed the Senate would not forward-fund public education for 2017 and would cut school funding by $47.5 million for the upcoming fiscal year. That's on top of cuts proposed to the state education department.
Minority Democrats failed in efforts to restore funds cut for next year and to add back money for pre-kindergarten. Sen. Bill Wielechowski, D-Anchorage, called the $47.5-million cut “questionably constitutional” and said he doesn't think it reflects Alaska's values.
But Senate Finance co-chairs Pete Kelly and Anna MacKinnon said these are tough times. Low oil prices have exacerbated a budget deficit projected to be in the billions of dollars, and state leaders are trying to preserve Alaska's reserves for as long as possible.
The North Slope oil price was about $107 a barrel when lawmakers left Juneau last April. The price on Thursday was about $52.
Debate on the budget was underway when the Revenue department released a spring forecast that lowered by $400 million a prior projection for unrestricted general fund revenue for the current year.
Kelly, R-Fairbanks, said a key point to keep in mind when discussing the budget is “we've got a big problem.”
It is seen as virtually impossible for the state to cut its way out of the predicament, and a number of lawmakers have said everything has to be on the table when looking at cuts. Education and Medicaid are major components of the state's budget.
MacKinnon, R-Eagle River, said what the committee did was responsible, wasn't easy and represents a starting point for negotiations with the House. Kelly said the proposal also provides some leeway in case prices drop again.
“We did what was in the best interests of the state of Alaska,” Kelly said.
Wielechowski, in a fiery speech, said he didn't think the people were treated with much respect by the process, taking issue in particular with the education cuts and pay-raise rejections approved by Senate Finance after public comment on the budget closed. He said he questioned the priorities the budget reflected.
“Here we are on Good Friday, cutting the poor, cutting the sick, cutting (benefits to) seniors,” he said. “But not a dime from the huge, outside multinational corporations.” Among other things, Wielechowski unsuccessfully sought to eliminate credits for three legacy oil fields.
On the education piece, the House forward-funded education for 2017 at 90 percent, the same as Gov. Bill Walker proposed.
The plan that came out of Senate Finance also assumed that $32 million in one-time education money for next year will be cut. Last session, the Legislature approved $32 million in one-time funds for 2016 and about $20 million for 2017. Walker previously proposed cutting those one-time funds, a move that's pending in a separate, supplemental budget.
The Senate version also rejected monetary terms in collective bargaining agreements for more than a dozen unions unless separate legislation with explicit language approving them is enacted. It also would remove salary increases for employees not covered by unions, though separate legislation is required to do that, the director of the Legislative Finance Division has said.
The Senate did agree to add language calling for a report on all state employees whose base salaries exceed that of the governor, after concerns had been raised with the salaries and benefits for employees at some state corporations.
In terms of agency cuts, the state public defender has warned of delays in criminal trials and appeals if a proposed $1.2 million cut to his agency goes forward. The state ferry system would be cut by $13.2 million compared to the current year. There also are cuts in areas such as public broadcasting.
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